Note to Readers: The Morning Download will be off Monday for Presidents Day. We’ll be back Tuesday morning. Have a great weekend.

A bug in AppleInc.‘s most recent iPhone update is causing issues for many businesses that allow the iPhone to run on their networks, CIO Journal’s Clint Boulton reports. Some CIOs, frustrated by this turn of events, have asked employees to delay updating the OS on their iPhones, and have taken steps to limit the impact on their networks.

Microsoft Corp. said Tuesday that customers may want to block iOS 6.1 from their corporate networks after a flaw in the new operating system was found to overload Microsoft’s Exchange email software with traffic. Apple on Thursday confirmed another flaw in iOS 6.1 that lets users skip the password lockscreen to access contacts, photos and other information. Apple said it is working on a patch for this flaw. Apple also said it would release a fix for the Exchange flaw.

To address the iOS 6.1 issue, Covanta Energy Corp. CIO Stuart Kippelman said he limited bandwidth for iPhone and iPad users accessing Exchange from 6.1. He also advised users not to upgrade to 6.1, and is preventing users from responding to calendar invitations via their iOS devices. Mr. Kippelman said it was “unacceptable” that Apple has taken more than two weeks to address the issue. “I think it puts a spotlight on how careful IT needs to be, even when everyone’s expectations are the speed of adoption should be as fast as devices are created,” he said.

Best-of-breed applications have their day. Cloud computing has made it financially and operationally viable for a company to pick the world’s best application for every need, user and business case, Guest Columnist Byron Deeter writes. After more than a decade of software industry consolidation and the dominance of “all in one” software suites, it is becoming increasingly difficult to justify a suite purchase, he finds. Business users were previously forced to accept inferior products in the interest of seamless integration and simplicity that never materialized. Instead, all too often the attempts to install monolithic software suites ended in projects that ran well over budget, took months or years longer than planned and left business users with legacy options, if the projects ever went live at all, according to Deeter, a Bessemer Venture partner who has led investments in cloud-based companies. “The cloud, with its open, flexible … application architecture means that integration is far easier and cheaper to manage today,” he says.

TECHNOLOGY NEWS

Broadband firms meet speed promises. American Internet users generally receive the download speeds that companies advertise, with fiber and satellite connections frequently outperforming expectations, according to a new report from the Federal Communications Commission. The study, conducted last September, found most companies offer download speeds during peak periods that roughly match what they advertise. Verizon Communications Inc.’s fiber connection, the company’s fastest, averaged download speeds that were 118% of advertised download rates. Cablevision Systems Corp. came in at 115% and Comcast Corp. delivered 103%, the WSJ reports.

Lawmakers reintroduce Web sales tax legislation. Republican and Democratic lawmakers reintroduced legislation Thursday that could force Internet retailers to collect sales taxes, the latest effort by states and Washington to end what they call a handicap on brick-and-mortar businesses, the WSJ’s Danny Yadron reports. The Marketplace Fairness Act would allow states to collect sales taxes from online retailers for transactions within the state. It would provide an exemption for businesses with less than $1 million in annual domestic sales.

Former RIM CEO sells remaining stake. Jim Basille, a former co-CEO of Research in Motion Ltd., has sold all his remaining shares in the company, the WSJ’s Ben Dummett and Will Connors report. Mr. Basille, who stepped down from his executive position last year during a wide-ranging management overhaul, had owned as much as a 5.1% stake as recently as late 2011.

Fax machines roll on in Japan. The country that developed fax technology in the 1970s just can’t quit it, says the NYT’s Martin Fackler. Today, the machines can be found in 45% of private homes and almost 100% of businesses. Experts tell Fackler that bureaucrats like the paper trail fax machines create, while individuals enjoy the personal nature of writing a fax. No one commented on finding the fax’s chalkboard scratch-like sound pleasant to the ear. “Japan’s reluctance to give up its fax machines offers a revealing glimpse into an aging nation that can often seem quietly determined to stick to its tried-and-true ways,” writes Fackler. “The fax addiction helps explain why Japan, which once revolutionized consumer electronics with its hand-held calculators, Walkmans and, yes, fax machines, has become a latecomer in the digital age.”

Thanks for nothing, Adobe. Engineers at Adobe Systems Inc. say its Reader application has built-in protection from a zero-day exploit discovered recently by security firm FireEye, but users will need to manually turn on the protection for it to work. “It’s disappointing that Adobe took the time to design a feature that can protect its users but didn’t turn it on by default,” writes Ars Technica’s Dan Goodin. “I can’t help comparing the move to a car manufacturer that installs airbags in one of its models, but then requires customers to flip a switch before the bags actually inflate.”

Android, iOS steamroll smartphone competition. As if anyone needs reminding, IDC reports that in the fourth quarter of 2012, Android and iOS killed it in the smartphone market, combining for 91.1% of all smartphone shipments world-wide. For the calendar year, Android claimed a 70.1% share of the 722.4 million smartphones shipped, while iOS took 21%. BlackBerry eked out a 3.2% share, followed by Windows’ 2.6%.

Many uneasy with Obama’s executive order. President Obama’s cybersecurity executive order reopens a heated discussion computer scientists and civil liberties groups have had for years about the trade-offs between privacy and security, writes the NYT’s Somini Sengupta. The order, which asks government agencies to share with private companies intelligence about security threats, has been criticized as too soft by critics who argue that private companies, in turn, should be required to share data on recent cyberattacks with the government. But many civil libertarians fear that sharing data with the government can have unforeseen consequences. “Once that private information is in the hands of the military, it can be used for purposes completely unrelated to cybersecurity,” argued Leslie Harris, president of the Center for Democracy and Technology.

Dropbox talking IPO. Cloud storage firm Dropbox Inc. is meeting with banks about an initial public offering, reports Quartz’s Gina Chon. On Tuesday the company unveiled a new system aimed at business users. Previously Dropbox, which has about 200 million users, based its growth on appealing directly to consumers, many of whom later introduced the service to their business. Chon says Dropbox’s recent move to the enterprise “reflects the realities of which tech companies have done well since going public in recent years.” While professional-focused companies such as Palo Alto Networks have found success, more consumer-focused companies such Groupon have been pummeled.

A Chinese hacker’s identity unmasked.Businessweek’s Dune Lawrence and Michael Riley report on a case where security experts at Dell Inc. not only succeeded in tying a number of China-based cyberespionage campaigns to an individual living in China, but they managed to turn up blog posts and family photographs featuring the the person. Businessweek follows the trail to PLA Information Engineering University in the city of Zhengzhou in China, where Zhang Changhe, a teacher at the university, denies all involvement.

WHAT YOUR CEO IS READINGEvery week, CIO Journal offers a glimpse into the mind of the CEO, whose view of technology is shaped by stories in management journals, general interest magazines and, of course, in-flight publications.

Welcome to the malware-industrial complex.MIT Technology Review’s Tom Simonite reports on the rise of an international black market for “zero-day” bugs, vulnerabilities that hackers can use to sneak malicious software onto computer systems. “On the one hand the government is freaking out about cyber-security, and on the other the U.S. is participating in a global market in vulnerabilities and pushing up the prices,” a technologist at the American Civil Liberties Union tells Simonite. As prices rise, the programmers who find such vulnerabilities are increasingly ignoring bounties offered by Google and other software makers in favor of selling their knowledge to the highest bidder. The influx of public money into cyberdefense will only make everything worse, writes Simonite. “And an escalating cycle of competition between U.S and overseas government agencies and contractors could make the world more dangerous for computer users everywhere.”

Cashing in on the yuan. “Little by little, China’s currency is gaining ground,” writes the Economist. The yuan now accounts for 15% of the world’s money supply—not bad considering that until mid-2009 almost all of it was sealed within China’s borders—and in Q4, trade settled with the yuan hit $145 billion. The yuan, which ranks 14th in international payments, still has a ways to go–government capital controls and a need for serious bank reform limit its reach. But businesses are catching on to the fact that using the yuan helps them avoid costs associated with the foreign-exchange regulations applied to dollar-based transactions. Any reluctance by Western firms in adopting a foreign currency is almost becoming moot, says the Economist, as the West accounts for a falling share of China’s trade. “Firms in emerging economies, accustomed to other people’s currencies, may be quicker to adopt the yuan than Western rivals wedded to the dollar, euro or pound.”

Lessons from the software industry. From helping design new products to facilitating new forms of collaboration, software plays an increasing role in a company’s performance. In light of that success, executives could find benefits in applying software industry business models to their own organizations. Business leaders must realize that “almost every company is becoming a software company,” write McKinsey Quarterly’s Hugo Sarrazin and Johnson Sikes. “A base level of software fluency will be a requirement for all levels, including upper management, in order to understand not only the core technologies but also the dynamics of working in a quick-turn, massively more connected, and digitized marketplace, in which economic value is driven increasingly by information-based services.”

EVERYTHING ELSE YOU NEED TO KNOW

Big deals are making a comeback. Yesterday, we witnessed a $40 billion wave of deals, bringing the total value of M&A transactions announced since January to nearly $160 billion — the fastest start to a year since 2005, the WSJ’s Francesco Guerrera and Dennis K. Berman report. The biggest deal by far was the $23 billion Heinz acquisition by Berkshire Hathaway and Brazilian private-equity firm 3G Capital. But we also saw the announcement of the $11 billion AMR-US Airways merger, and a reworked deal — worth $4.75 billion — for Anheuser-Busch InBevover the divestment of some brands to Constellation. To top it all off, there was Cardinal Health‘s $2 billion purchase of rival AssuraMed.

Patent case against Monsanto could impact tech industry. A legal dispute between an Indiana farmer and Monsanto over how long the company can claim patent protection for its genetically engineered seeds could have broad implications for industries, the WSJ’s Ian Berry writes. The case is set to be heard by the Supreme Court and the ruling could influence patent rights for other companies developing technologies that either replicate themselves or can be copied by their users. Various trade groups have filed briefs supporting Monsanto, including organizations representing Microsoft and Apple. The groups say a ruling against the seed maker would “eviscerate” tech companies’ patent protection.

Comments (3 of 3)

There are many problems with iOS 6.1: many apps simple don't work. One wonders if Apple did any testing on the new operating system. App developers found out the hard way their apps no longer worked - from their customers. Apple isn't always what it thinks it is or what its press releases say it is......

8:56 am February 15, 2013

Lord Save WSJ wrote:

Seriously?? How many CIOs did you talk to? It was an inconvenience that was resolved everywhere. Did CIOs talk about hassles because of Windows? My Lord.. WSJ is turning into a tabloid to aid shorts and manipulation. The beacon of Capitalism is in the gutter with endless thrashing of Apple.

8:32 am February 15, 2013

Proprietary Apple world wrote:

Serves them right for putting their trust in a vendor who doesn't play well in the enterprise. No CIO is going to commit to one vendor for everything. There is no such thing as a proprietary world.

The factors that render the electrical grid vulnerable to cyber attack are strikingly similar to the cyber risk issues faced by health care, financial services, and other industries. But one recent malware campaign targeting utilities shows just how exposed the grid remains to cyber threats.